Budgeting

How Can I Cut Down my Spending?

There are a lot of us that might feel that we spend too much money. We might have a look at our bank balance and wish that we could spend less money. This might be because we struggle to cover the cost of the important things, because we would like some money left to put in a savings account or because we want to repay a debt. Whatever the reason, there are things that we could try which should help us to spend less money.

Compare Prices

It is a good idea to start by comparing the prices of the things that you are buying. You will find that there are a lot of things that you buy automatically without checking to see whether they are available cheaper. Therefore, it is wise to start checking those prices to see whether you can benefit from some cheaper offers being available. Check prices within the place you are shopping but also compare between different places. Make sure that you do this for all things that you buy, not just when you are in a shop. So look at all of the things that you pay for automatically with direct debits or standing orders and think about whether you will be able to get those things cheaper if you switch providers. You could make a considerable difference by changing a few places that you shop and if you do it for everything you buy then you will make an even bigger impact on how much you are spending.

Question If You Need it

It can also be worth asking yourself whether you really need items when you are buying them. We buy all sorts of things and some are more important to us than others. It can be a good idea to think about the different things that you are buying and whether they are essential for you to have or whether you feel that they are things that you could go without. Sometimes we buy items that we do not really need or perhaps even want and this means that we can end up having items unnecessarily. Therefore, make sure that you ask yourself before you buy something, whether it is an item that you really need or whether you can manage without it.

Shop Less Often

It can also help you to buy less if you shop less often. Whether you are going out to physical shops or shopping online. Perhaps restricting yourself to a certain amount of days a month for shopping or setting a financial budget so that you know exactly where you are with it all. This can have huge benefits as it will mean that you will be able to control what you are doing more easily. It can be so easy to get carried away when shopping and marketing people know exactly what to do in order to tempt us to spend more money, so the less we are exposed to it the better.

Save First

What this refers to is that you put some money into your savings account hen you first get paid. This will allow you to make sure that you do not spend everything all at once. Hopefully, you will see that there is not much money in your account and work out what you have to pay for and this will allow you to be able to budget more carefully and spend less money. As you have put some in your savings, it will be there for you if you need it, but you will be able to keep it in there if you can and then you will not spend so much.

Savings

Why Should I Bother to Save?

There are many people that have lots of savings behind them but also people that feel that saving up money is a waste of time. There are many advantages to having some savings available to you and so it can be a good idea to think about some of these and whether it will convince you to get some savings of your own or help to motivate you to keep on saving up money.

Pays Interest

A savings account will pay you interest on your money. This can vary depending on who you save with and what type of account you have, however, it is better to have your money in an account earning interest, rather than at home in a jar or piggy bank. Although savings interest rates tend not to be really high, it can still be better to get that money than to not have it at all. It is something which can give us a little bonus or boost. There are big differences too in the interest being paid into different accounts. This means that you could find that you will be able to get more interest with some banks than others. Also, it will depend on whether you want instant access or whether you are happy to give notice for withdrawals or keep you money in an account for a fixed period of time. It is good to investigate what the options are as this will enable you to judge where will be the best place for you to put your money.

Provides Emergency Fund

Having money in a savings account means that you have something to use if you have an emergency and need money fast. Obviously, if it is tied up in a notice account or a fixed term account then it will not be so easy to get to it but you could put some in these accounts and keep some that is easier to get to should you need it. It can give great peace of mind to know that you will be able to use this money if you really need it. It can be a lot easier than having to wait and organise a loan or short term credit and also much cheaper than a loan as well.

Can Save up for Things

Having savings means that you get used to putting some money away from time to time. This will get you used to the idea of doing this and will mean that you will be more able to save up for things. It can be really useful saving up for items because it means that you will not have to borrow money to get them. If you can build up a decent amount of savings, it means that when you do need expensive items, you may already have the money available to buy them, even when you are buying something quite expensive. This will mean that you will not have to wait to buy the item and you will not have to borrow money. The reason saving is better than borrowing is more than just the cost. Normally it is dearer to borrow money than to use savings, but you will also find that you will have to normally make regular repayments. It can be stressful making these repayments or perhaps difficult finding the money each month. However, if you miss a payment you will have additional charges, so it is something that you really need to make sure that you do. If you use savings, it is likely that you will want to repay these too, but you will be able to be more flexible and if you cannot afford to put some money into your savings account one month, then you will not need to.

Debt

What is the Difference Between Good and Bad Debt?

We may hear about good and bad debt and think we know what this means but it is wise to make sure that we really do know what it refers to. It is a good idea to be really sure because it can influence our decision when we are examining loans and thinking about whether they will be right for us. This will help us to make sure that when we do take out a loan that it is the right thing for us to do.

What is Good Debt?

There are a few different ways to define debt. Some people will say that good debt is when you borrow money to buy things which will benefit you financially. This might seem a bit odd, but this could include something like a mortgage where you are buying a home which will enable you to stop paying rent and have somewhere cheaper to live compared with renting for the rest of your life. There are lots of examples and it will depend on your situation sometimes whether a loan will be good for you or not. There are other factors to consider as well when you are choosing a loan though. It is really important to make sure that you pick the right type of loan. When buying a home, it is easy to get the loan type right. However, in many other situations it is not so easy to know. You will need to think about how much you need to borrow and how long you want to borrow it for and that will help you. Then you will be able to pick between them better. It is also really wise to find out how much the loan will cost you and then you will be able to think about whether you feel that it will offer you good value for money. Also look at the repayments and make sure that you are confident that you will be able to afford them.

What is Bad Debt?

So from understanding what good debt is, then it is pretty easy to see what bad debt is. It is when you borrow money for something which will not help you to improve yourself. This could be something like a loan to buy some new jewellery when you already have some that will work for you. Also it is taking on a loan without properly checking that the one that you have chosen is the most suitable for you and that it is a competitive price. Comparing different lenders is a good way to check this out. Then you will need to also find out how much the repayments will be, so that you will be able to work out whether you will be able to afford these. You need to make sure that you actually do some calculations and look at your bank statements to see whether you will actually be able to afford them each month. Perhaps have a back up plan in case you cannot afford them too or else it will be considered to be bad debt.

It is not always that easy to work out whether something is good or bad debt. However, if you can think it all through then you will be able to make a better decision. It is good to take your time and not rush the decision because it can have a big impact on you and this could either be a very positive or a very negative thing. It is therefore worth having a think before you go ahead as it could make a considerable difference to regards to the cost as well as the whole borrowing experience and of course, you may decide not to borrow at all.

Budgeting

Tips for Reducing Your Car Use

Most households have a car, but running it is expensive. Every time we go out we will have to use fuel but we also add to the wear and tear on it which means the brakes, tyres and other things will need replacing more quickly. It is therefore a good idea to think about whether you should be using your car as much as if you use it less you will be able to save money. There are some things that you can try so that you can cut down.

Combine Trips Together

It can be a good idea to see whether you can combine some trips together. So perhaps if you drive past a supermarket on your way home from work then shop there then, rather than going home and making a special journey to the supermarket. Of course, shopping when you are hungry is never a good idea either as you could tend to buy much more than you intended. Therefore, make sure that you have a snack to have before you shop so that things are less tempting. You can also combine other trips too, like visiting people in succession rather than on different days. It will take a bit of planning, but it can make a big difference even if you only reduce your journeys a little bit. It will all add up and could really help in the long run.

Car Share

If you have two cars in your family, see whether you can car share more often when you are going out. If you cannot do that, then see whether you can car share with others, particularly on a commute to work. This could mean that 4 people could go in the one vehicle and this will save a lot of money. The idea is usually that one person will always drive and the others pay them towards their costs or that they take in turns in driving and no one pays anyone. It will be up to the group to decide what they should do. You will need to get in touch with other people that work in your office and do the same hours as you. You may find that your company has a list or notice board or an online system where you can sign up to this sort of thing.

Walk More

If you only need to make a small journey then it is a good idea to consider walking rather than taking the car. This will enable you to be able to not only save the money on fuel and things like that but also get some exercise which will benefit you. You could alternatively cycle instead. It can take longer to walk or cycle but it can be rather nice. You feel more in control as well as you are less likely to be held up compared to being in a car and so you will always know how long your journey will take.

Consider Public Transport

It can be worth looking into the cost of public transport. It is true that in some places it is more expensive to use public transport but this is not always the case, especially if you have a season ticket. Therefore, it can be a good idea to investigate the prices locally before dismissing the idea as you may be surprised. Consider not only the cost of the fuel that you would otherwise have to pay for but also the wear and tear on the car. You might even be able to get rid of the car if you can use it and the you would save money on tax and insurance as well, which could make a significant cost difference.

Budgeting

How to Spend Less on Toiletries

We all buy toiletries and it is something that is essential in today’s society. However, the cost can really add up and you may sometimes wonder whether there is anything that you can do to reduce the cost of them. There may be a few things that you could try which could help.

Find Cheapest Retailer

It is easy to stick with a retailer we know or even just buy toiletries at the supermarket for convenience. However, it can be cheaper to buy them elsewhere and it is a good idea to take a look at prices in various places to see how they compare. You may find things cheaper online, but there is the concern about fakes. But you should be able to find trusted sellers that you can use that you can buy form without concerns. You may even find big high street stores selling online, that perhaps you do not have near to where you live. Of course, there is a postage cost when you buy online and that is something that you will need to factor in, but if you pay parking to buy on the high street then this is something worth thinking about too.

Buy in Bulk/Special Offers

Sometimes you will find that certain brands will have special offer or bulk discounts. It could be a 3 for 2 offer or 2 for a certain price or something like this. It could be well worth stocking up when there is an offer like this. However, make sure that you will use the items that you are buying. Some people will always stick to the same brand so this will be okay for them. However, there are some people that will like to change brads every so often and if this is you, then think about whether the items will get used as it is not a good deal if you buy them and they just sit in the cupboard.

Try Cheaper Brands

It could be worth trying out some cheaper brands. Some do not have a good reputation and you may worry that they will not be as nice. However, it can be good to have a go and see whether they are okay. If you have not tried them recently, they may have changed and you may like them after all. There may also be new brands which you have not tried that you could have try out and see if you think they will be good. It can sometimes be fun trying out new things, but make sure that you do use them all up. Having lots of half used items is not good, it will be expensive for you. Maybe you have this already and you should consider using up a lot of those things.

Use a Bit Less

It can also be good to think about whether you really need to use all of the toiletries that you do. It might be that you could cut down on some of them or that you could use a bit less each time. Often, we will use more deodorant, perfume or make up than necessary and it could be relatively easy to cut down. Just think about how much you are using and whether you can use a little bit less here and there and the savings will add up as you replace the items less often. You may even be able to cut back on the amount of different items you use and that could save money too, just have think about what you buy and whether it really is necessary to buy it.